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FCA’s limited powers give Royal Bank of Scotland a pass

Royal Bank of Scotland (RBS) and its senior managers have escaped any chance of a penalty after the Financial Conduct Authority admitted it has “very limited” powers to take any action against the bank following allegations that its specialist turnaround unit asset-stripped struggling businesses.

Last year, the Financial Conduct Authority (FCA) launched an investigation into RBS’s Global Restructuring Group (GRG) following accusations that the unit pushed its small-business customers into bankruptcy to boost its own profits rather than help them like it was supposed to.

In a statement Andrew Bailey, FCA chief executive said: “It is important to recognise that the business of GRG was largely unregulated and the FCA’s powers to take action in such circumstances, even where the mistreatment of customers has been identified and accepted, are very limited.”

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